There is good news for China with the release of the recent Global Talent Index (GTI), which was put together by Heidrick & Struggles and the Economist Intelligence Unit(EIU).

The GTI is the first index of its kind, and it looks at how countries nurture and develop talent. It shows that China, along with the UK, are the only two countries that will climb the index in the next five years. They are both racing to catch up with the current leader, the United States.

According to the GTI the UK will have risen to 2nd place by 2012, and China, which is already in 8th position, will move up to 6th.

Emergent China

The logic of China’s ascent is that it will continue developing its education system and this will create a better environment for producing and nurturing talent. This in turn will develop its manufacturing base and attract increasing amounts of Foreign Direct Investment (FDI).

The only proviso is that China relies for its success on its huge population size, more especially the number of working people in the age group 20-59. This cohort is in their productive years and the demographic advantage they offer will not last forever. Eventually they leave the workforce.

Meanwhile, the US will rank lower because its labor market is becoming less open and flexible. It will rank 9th worldwide on the GTI - which is only one place above China.

The report rates and ranks 30 countries on a long list of factors that includes basic education, quality of universities, labor market flexibility, mobility and other related measures.

One item of strong interest here is that the GTI shows that the often quoted acronym BRIC, which stands for Brazil, Russia, India and China is not really accurate. Based on the GTI it is more like IC, with Brazil and Russia falling from their respective perches. Russia is predicted to fall from 6th to 11th place by 2012, and Brazil is predicted to slip from 18th to 19th place.

Outcomes

My take-away from the survey is that it may accurately predict the evolution of talent in countries around the world. With the strong influence of the two players that produced the GTI, the report itself may actually influence things like FDI.

The GTI could be somewhat of a self-fulfilling prophecy.